Azlina Bulmer, programmes & development manager at Charity Bank makes sense of social investment-readiness and funding opportunities for charities and social enterprises.
The gap between social investment and the voluntary sector is starting to be bridged by new initiatives and I was thrilled to see, for example, Access The Foundation for Social Investment announce it will help to make investment available to small and medium-sized voluntary organisations.
If you’re working in this landscape of emerging funding options the jargon can sometimes stand in the way of pursuing them. Take ‘investment-readiness’ for example, a process that potentially presents a fantastic opportunity for your organisation. What exactly does it mean?
Social investment and investment-readiness
- Social investment is finance provided to voluntary, community and social enterprise (VCSE) organisations which investors expect to be returned, and that is designed to have a social value.
- Investment-readiness, or becoming investment-ready, is the process of preparing your organisation to apply for social investment or a loan. An investment-ready organisation will have the resources to identify, apply for, and secure investment or loans.
Credible business plans
Becoming investment-ready requires charities and social enterprises to refine business practices, governance structures and management teams to attract investment.
It means carrying out thorough financial modelling, and detailed market research, to produce credible business plans that stand up to investor scrutiny. Imagine this process as constructing a bridge between organisations and social investment.
Investment-ready tips
To prepare for investment or loans an organisation requires:
- strong leadership
- business planning
- robust finances
- good governance
- comprehensive policies and procedures.
Getting started
Bear in mind that each organisation has different requirements and will need different levels of support – there is no one size fits all option. For many, investment-readiness is a relatively new concept and many organisations will require some support.
How much work is this?
Becoming investment-ready may require a lot of additional work. But the process will make your organisation more resilient and sustainable. Whether or not you decide to apply for investment, by becoming investment-ready you will have more options, and be in a position to make informed decisions about financing.
Links to further information
- NCVO’s UK Civil Society Almanac’s says, “A social enterprise is a business that trades for a social or environmental purpose and that reinvests its profits to further its social mission.” The Almanac explains more on its page on the relationship between social enterprise and civil society.
- If you are considering a loan Charity Bank is a lender and offers loans at a discount to NCVO members.
- The Big Potential programme is run by the Social Investment Business, in partnership with Charity Bank. It is aimed at helping voluntary organisations to access social investment.
- Social Enterprise UK is a national membership organisation for social enterprises.
- Locality is a network of over 500 organisations and helps communities to establish locally owned or managed organisations
- University of Northampton in association with a number of partners, that include Big Lottery, provides business investment and mentoring support opportunities to charities and social enterprises in Northamptonshire.
- Can Invest helps organisations access finance.
- Jargon buster: words to help you navigate the world of social investment.
- Glossary on social investment terminology from Big Society Capital.
Posts written by guests who have contributed to NCVO projects and events. 
